General

Defining lease terms crucial to resolving disputes

We often emphasize the importance of having a clear, comprehensive commercial lease in place, whether you are a landlord or tenant in Florida. However, even when you believe you have such an agreement in place, issues can and do arise.

For instance, recently, a dispute arose between a Whole Foods store in another state and the grocer’s landlord. The argument centers on what each parties considers “beyond the control” of the landlord and the tenant.

Backing up, we should explain that the whole situation started when Whole Foods had to close the store due to an apparent rat and pest infestation. The pest problem was evidently widespread, and demanded extensive work to address and repair the damage. The store remained closed for more than 60 days.

This length of closure was in violation of the lease agreement in place. The landlord cited this limit in its claim that Whole Foods violated the lease.

However, Whole Foods recently filed its own lawsuit against the landlord asserting that efforts to penalize the grocer and delay renovation are in violation of the lease terms that allow closures longer than 60 days when they are “beyond the control” of either party. Whole Foods argues that they have to stay closed longer than 60 days in order to gut and rebuild the store so that it meets contractual standards and passes inspections.

While this case has yet to be resolved, it is a good example of how two parties can interpret lease clauses differently, even when they seem straightforward. This is especially true when there are subjective terms like “reasonable” or “appropriate” involved.

In similar situations involving commercial lease disputes, parties may be able to come to a resolution outside of court with negotiation, mediation and/or arbitration. Should these efforts fail, then litigation would be necessary.

Tue Aug 28, 8:35pm